Answering to the Planet

Taking care of the planet is built into our corporate structure. The Global Environment, Health, Safety and Sustainability (EHS&S) organization is charged with ensuring company-wide adherence to our environment, health and safety policy. This organization is led by the Vice President of EHS&S, who reports to the President of Corporate Operations, a direct report to the Chairman and Chief Executive Officer. The governance model we use to accomplish this task includes clearly defined goals, a single set of worldwide standards and an audit process that validates conformance to these requirements. Our EHS&S governance policy, adopted in 1991, forms the foundation of our environmental leadership program. For a review of this policy, visit www.xerox.com/environment.

In 2011, our environmental sustainability governance structure evolved to align with our progress on the journey toward embedding all aspects of environmental sustainability into business strategy and operational processes. We established an Environmental Sustainability Steering Committee that is co-chaired by the President of Xerox Global Technology Delivery Group and the President of Corporate Operations, and includes executive representation from across the business. This Steering Committee champions and guides the corporate environmental sustainability program to establish strategic priorities that align with corporate goals and ensure that environmental sustainability is considered in key business decisions.

Supplier Management
As a critical element of supply chain governance, Xerox extends environment, health and safety requirements across our supply chain. Since 1998, we have asked our materials and components suppliers to meet specific environmental, health and safety requirements. These requirements were broadened in 2004 to better govern the use of chemicals in our products, parts and supplies throughout the supply chain. The Xerox standard, "Xerox Environmental, Health and Safety Supplier Requirements: Chemical Bans/Restrictions and Part Marking," establishes requirements for regulatory compliance, chemical bans and restrictions and parts marking for parts and materials intended for use in electronic products. The standard also requires that suppliers utilize socially responsible supply chain due diligence practices including but not limited to mining and smelting operations.

Further, by adopting the Electronic Industry Citizenship Coalition's Code of Conduct, we have strengthened our commitment to ensure that our suppliers are operating according to accepted industry standards for environmental management. Since 2003, we have extended the requirements to companies that provide paper to Xerox for resale. In 2009, through our Socially Responsible Procurement Policy, we formally began extending social responsibility requirements, such as ethics, labor, environmental, health & safety and security controls across our supply chain. More information is available in the Supplier Relations section of this report.

Audit Program
A well-established internal audit program measures our success in implementing corporate standards and guidelines and validates regulatory compliance. To identify environmental, health and safety risks and potential areas of non-compliance, we audit research, manufacturing, engineering and service operations an average of once every three to five years. The frequency of the audits and content is based on the type of operations and the inherent risks associated with the operations. Beginning in 2012, our services operations (formerly ACS) will be included in the audit schedule. Xerox audit teams evaluate operations against our internal standards, regulations and industry guidelines and, beginning in 2010, also evaluated management system performance. With the assistance of the local managers and support staff, action plans are developed and deficiencies corrected. Senior management pays particular attention to situations with the potential to pose a significant risk of environmental damage, serious injury to employees or regulatory non-compliance. In 2011, Xerox met its goal of resolution of these issues within 90 days, and continued to demonstrate that the audit program has become an important mechanism for identifying and correcting performance gaps.

Employee Training and Education
Through training and internal communication, we make employees aware of how our operations affect the environment and employee safety. Beginning with our new hire orientation, employees are made aware of the environment, health and safety requirements that are relevant to all employees. As appropriate, employees receive training on topics such as hazardous waste management, spill prevention and response, recycling, ISO 14001 and a variety of other topics. In addition to any regulatory-required safety topics, employees are trained on established safe job procedures based upon the job-specific hazards they may encounter and procedures and protective equipment they are expected to use.

Our environmental policy is posted in our facilities and on our internal website. We utilize a variety of processes to deploy environment, health and safety goals to all our operations, including integration into the product development process and services deployment process. Through our ISO 14001 environmental management system, employees are routinely involved in identifying the environmental aspects associated with their responsibilities. In 2011, a significant number of facilities management personnel responsible for our recently acquired ACS facilities were made aware of our environmental sustainability and compliance programs and trained on how to identify sustainability opportunities and perform regulatory applicability assessments. This training included both Xerox facilities personnel and those from our third party management company.

Stakeholder Outreach
Xerox communicates with stakeholders about our programs, performance and goals for environmental health and safety. Stakeholders include employees, customers, investors, universities, government agencies and environmental groups. We track inquiries from customers and other stakeholders and comments through our customer EHS&S Support "hotlines" in North America and Europe. We also hear from customers through focus groups and from the larger community by participating in a number of external organizations. We conducted dozens of sustainability forums with customers and other stakeholders in 2011, generating awareness of the importance of sustainability, sharing best practices in industry, government and academia, and encouraging customers to reduce their environmental footprint by finding "Smarter Ways to Green."

Our Progress

"All of us at Xerox are determined to build a company that serves all its stakeholders - the shareholders who invest in us; the customers who trust us to make them better; the employees who bring their minds and hearts to our belief that good financial results and good citizenship are synergistic; the communities in which we live and work and that deserve our engagement; and, ultimately, the planet, which we all have an obligation to preserve and sustain."

Preserving the Planet

As part of our commitment to conserve resources, we monitor water consumption across our manufacturing, distribution and R&D facilities worldwide. Water consumption has decreased 37% since 2007 and is down 15% in 2011 compared to 2010...
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Preserving the Planet

Scope 1 and 2 greenhouse gas emissions are down 36% and energy consumption is down 25% from 2002 in our Technology business. The reductions are the result of improved energy efficiency, new technologies and improved energy management practices...
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Preserving the Planet

In 2011, 100% of all of our new eligible products met the current ENERGY STAR (July 2009) requirements. Continued success in cutting the power consumption of our laser-based printing products has been achieved by adjustments in the fuser design...
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Preserving the Planet

The Xerox Green World Alliance reuse/recycle program for imaging supplies is central to our commitment to waste-free products. We currently have more than 35 countries participating in the Xerox Green World Alliance...
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Preserving the Planet

We are in the process of expanding Greenhouse Gas tracking to include Scope 3 emissions, beginning with employee business travel. We measured these 2011 Scope 3 emissions at 12K metric tonnes of CO2e, down 14% from 2010...
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Preserving the Planet

Reported toxic chemical releases and transfers were 15% lower than 2010, primarily due to the reduced production of older products. Methylene chloride releases and transfers, which account for over 50% of reported toxic chemicals...
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Corporate Knights USA placed Xerox in the top five

Preserving the Planet | Answering to the Planet

Corporate Knights USA placed Xerox in the top five of its inaugural Standard & Poor's 500 clean capitalism ranking, a listing of the world's most sustainable corporations. The ranking is based on a comprehensive set of environmental, social and governance metrics created to reveal a company's degree of "clean capitalism."

Read more about the recognition our citizenship activities have received.

The Xerox Board of Directors: Maintaining independence

Sustaining Business

Based on standards for independence developed by the New York Stock Exchange, the Xerox Board of Directors is currently 90% independent. It includes one non-independent director: Xerox Chairman and CEO Ursula M. Burns.

Learn more about the Board's independence and our governance policies.

Voice of employee survey

Evolving the Workplace

74% of surveyed employees responded favorably to the statement "My work gives me a feeling of personal accomplishment" on our proprietary Voice of the Employee Survey.

The survey allows managers to create a personal pulse survey to assess their employees' satisfaction on their job, workgroup, manager, and on Xerox as a whole.

In the past three years, we have surveyed 100% of the global Xerox population in 48 countries and in 25 languages. Each manager receives a personalized report to assist in developing action plans where needed. In addition, we capture global trend data and employee ideas.

Employee Diversity – Women employees

Evolving the Workplace

We gain a competitive advantage as we continue to draw on the experience and creativity of a well-balanced, diverse work force. That means we're better able to understand and meet the changing demands for our products and services. Simply stated, a balanced work force makes good business sense.

49.8% of employees in U.S. are women and women represent 25% of the executive and senior level managers in the U.S. Diversity reporting is not tracked in most other countries.

Employee Diversity – Minority employees

Evolving the Workplace

Minorities represent 37.5% of employees and 13.2% of the executive and senior level managers in the U.S. Diversity reporting is not tracked in most other countries.

Employees with different ways of thinking – and different ways of perceiving our world – are employees who create innovative solutions. In a business like ours, whose lifeblood is fresh ideas, this variety of perspectives is a priceless resource – and a key to achieving critical business results.

Monitoring the safety of our employees

Evolving the Workplace

We strive toward a goal of zero injuries, with continual improvement in safety performance in both injury frequency and severity. In 2011, there was a 1% reduction in the frequency of injuries compared to 2010 performance. Since 1996 there has been a 56% reduction in total recordable injury rate.

Reporting and monitoring of injury frequency rates occurs for different geographies and organizations. The reporting of work-related injuries, illnesses and fatalities is based on the same criteria for all operations, worldwide, regardless of the geography in which they reside.

Preventing injuries and illnesses

Evolving the Workplace

We strive to prevent all injuries and illnesses and place special emphasize on the elimination of serious incidents – those that are significant enough to require missed days of work. 2011 proved to be a challenging year and additional mitigation initiatives have been put in place. Since 1996 there has been a 48% reduction in the days away from work injury rate.

Topping the competition

Serving Customers

Xerox is the leader in equipment revenue market share for the tenth straight quarter (1Q2012). We offer the industry's broadest portfolio of document technology and services for businesses of any size, in any industry, anywhere around the world.

Innovating for the future

Serving Customers

The Xerox group garnered over 1,600 patents total. Xerox was granted 1,030 U.S. patents and our joint venture in Japan, Fuji Xerox Co. Ltd., received 588 U.S. patents. Xerox and Fuji Xerox collectively invest about $1.5 billion annually in research, development and engineering.

Measuring customer satisfaction

Serving Customers

Service and support for Xerox products earned five consecutive industry certifications from 2006-2010. All forms of customer support – phone, on-line, on-site – were evaluated by independent service industry experts who recognized our support services as among the best in class.

Investments in J. D. Powers certification in prior years have ensured process excellence in technical service delivery. In 2011, we chose to invest in a new customer satisfaction process to ensure a stronger focus on understanding and fulfilling customer needs and expectations.

The new process solicits feedback from our technology customers around the globe and provides detailed insights that help us identify systemic issues and make the necessary changes that ensure strong customer satisfaction. Improved closed-loop follow-up processes also enable faster responses to individual problems.

2008

2009

2010

Achieved certification in the J.D. Power and Associates program for Certified Technology Service and Support.

Achieved certification in the J.D. Power and Associates program for Certified Technology Service and Support.

Achieved certification in the J.D. Power and Associates program for Certified Technology Service and Support.

Industry analysts rate Xerox products and services as market leaders

Serving Customers

The Xerox commitment to our customers has gained worldwide recognition. Independent Industry analysts rate our products and services as leaders in multiple categories. Helping customers better manage their print environment led Gartner to place us in the Leaders Quadrant of the 2011 Magic Quadrant for Managed Print Services Worldwide, while International Data Corp. (IDC) MarketScape lists us as a Market Leader for managed print services for the third year in a row. And it's not just our award-winning technology that garners all the accolades. Gartner placed Xerox as a global leader in the Comprehensive Finance and Accounting Business Process Outsourcing arena and also noted our leadership for Help Desktop Outsourcing Services in North America.

The Xerox Foundation

Caring for Communities

In 2011, 1,672 non-profit organizations, colleges and universities received direct financial support from the Xerox Foundation through grants, matching gifts or community involvement activities. We focus our investments in the following areas:

The Xerox Community Involvement Program

Caring for Communities

The Xerox Community Involvement Program marries the voluntary spirit of our employees with Xerox funding to participate in the betterment of the communities where we live and work. In 2011, 12,291 Xerox people participated in 751 projects and the Xerox Foundation invested over $1 million in the program.

Conserving water

Preserving the Planet

As part of our commitment to conserve resources, we monitor water consumption across our manufacturing, distribution and R&D facilities worldwide. Water consumption has decreased 37% since 2007 and is down 15% in 2011 compared to 2010.

Reducing greenhouse gas emissions

Preserving the Planet

Scope 1 and 2 greenhouse gas emissions are down 36% and energy consumption is down 25% from 2002 in our Technology business. The reductions are the result of improved energy efficiency, new technologies and improved energy management practices.

Having met our Energy Challenge 2012 goal, we are in the process of establishing a new baseline and target.

New products achieve the ENERGY STAR® rating

Preserving the Planet

In 2011, 100% of all of our new eligible products met the current ENERGY STAR (July 2009) requirements. Continued success in cutting the power consumption of our laser-based printing products has been achieved by adjustments in the fuser design, changes to the properties of the toner, more-efficient electronic controls and the workings of the xerographic system as a whole.

See more detailed information on Energy Star ratings for Xerox Products.

The Xerox Green World Alliance

Preserving the Planet

The Xerox Green World Alliance reuse/recycle program for imaging supplies is central to our commitment to waste-free products. We currently have more than 35 countries participating in the Xerox Green World Alliance. Worldwide, our customers returned more than 3.43 million cartridges, toner containers and other used supply items in 2011. Although Xerox's consumables returns programs have been in existence for two decades, we enhanced the program in 2010 by launching an improved return process for our Canadian operations.

Reducing emissions by reducing employee air travel

Preserving the Planet

We are in the process of expanding greenhouse gas tracking to include scope 3 emissions, beginning with employee business travel. We measured these 2011 scope 3 emissions at 12,000 metric tonnes of CO2e, down 14% from 2010. A decrease in employee air travel has been achieved through the increased use of videoconferencing and other technology. We're currently in process of collecting scope 3 emissions data on product transportation from third-party carriers.

Assessing scope 3 emissions is challenging but we are making progress and are making our calculations according to the WRI Scope 3 Accounting Standard. We will use the information to prioritize our greenhouse gas emission reduction opportunities and as part of our carbon impact assessments.

Reducing toxic releases

Preserving the Planet

Reported toxic chemical releases and transfers were 15% lower than 2010, primarily due to the reduced production of older products. Methylene chloride releases and transfers, which account for over 50% of reported toxic chemicals, were lower by approximately 15 metric tonnes.